Question
In: Accounting
The following data apply to the provision of psychological testing services: Sales price per unit (1...
The following data apply to the provision of psychological testing services:
| Sales price per unit (1 unit = 1 test plus feedback to client) | $ | 330 | |
| Fixed costs (per month): | |||
| Selling and administration | 20,000 | ||
| Production overhead (e.g., rent of testing facilities) | 20,000 | ||
| Variable costs (per test): | |||
| Labor for oversight and feedback | 170 | ||
| Outsourced test analysis | 21 | ||
| Materials used in testing | 5 | ||
| Production overhead | 15 | ||
| Selling and administration (e.g., scheduling and billing) | 17 | ||
| Number of tests per month | 2,000 | tests | |
Required:
Calculate the amount for each of the following (one unit = one test) if the number of tests is 2,000 per month. Also calculate if the number of tests decreases to 1,250 per month. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar.)
2,000 Tests 1,250 Tests
a.Variable production cost per unit.
b.Variable cost per unit.
c.Full cost per unit.
d.Full absorption cost per unit.
e.Prime cost per unit.
f.Conversion cost per unit.
g.Contribution margin per unit.
h.Gross margin per unit.
Solutions
Expert Solution
| 2000 tests | 1250 tests | |
| a.variable production cost per unit | $211 | $211 |
| b.variable cost per unit | 228 | 228 |
| c.Full cost per unit | 248 | 260 |
| d.Full absorption cost per unit | 221 | 227 |
| e.Prime cost per unit | 196 | 196 |
| f.Conversion cost per unit | 216 | 222 |
| g.Contribution margin per unit | 102 | 102 |
| h.Gross margin per unit | 109 | 103 |
| working: | ||
| 2000 test | 1250 tests | |
| a.labor +outsourced test +materials used +production | 170+21+5+15=>211 | 170+21+5+15=>211 |
| b.variable production cost + selling and administration | 211+17=>228 | 211+17=>228 |
| c.variable cost per unit + (total fixed costs/number of tests) | 228+ (20000+20000)/2000=>248 | 228+ (20000+20000)/1250=>260 |
| d.variable production cost per unit + production overhead / number of tests | 211 + 20000/2000 =>221 | 211 + 20000/1250 =>227 |
| e.material + labor + outsource test analysis | 5+170+21=>196 | 5+170+21=>196 |
| f.labor + outsource test+ variable production overhead+ fixed production overhead /number tests | 170+21+15+(20000/2000) | 170+21+15+(20000/1250) |
| =>216 | =>222 | |
| g.sale price - variable cost per unit | 330-228=>102 | 330-228=>102 |
| h.sale price - full absorption cost | 330-221 =>109 | 330-227 =>103 |
ekkarill92 answered 1 year agoRelated Solutions
The following data apply to the provision of psychological testing services: Sales price per unit (1...
The following data apply to the provision of psychological
testing services:
Sales price per unit (1 unit = 1 test plus feedback to
client)
$
320
Fixed costs (per month):
Selling and administration
16,000
Production overhead (e.g., rent of testing facilities)
20,000
Variable costs (per test):
Labor for oversight and feedback
160
Outsourced test analysis
19
Materials used in testing
6
Production overhead
15
Selling and administration (e.g., scheduling and billing)
16
Number of tests per month
2,000
tests
Required:...
The following data apply to the provision of psychological testing services: Sales price per unit (1...
The following data apply to the provision of psychological
testing services:
Sales price per unit (1 unit = 1
test plus feedback to client)
$
320
Fixed costs (per month):
Selling and administration
18,000
Production overhead (e.g., rent
of testing facilities)
22,500
Variable costs (per test):
Labor for oversight and
feedback
165
Outsourced test analysis
19
Materials used in testing
7
Production overhead
9
Selling and administration
(e.g., scheduling and billing)
14
Number of tests per month
2,000
tests
Required:...
The following data apply to the provision of psychological testing services: Sales price per unit (1...
The following data apply to the provision of psychological testing
services:
Sales price
per unit (1 unit = 1 test plus feedback to client)
$
340
Fixed costs
(per month):
Selling and
administration
16,000
Production
overhead (e.g., rent of testing facilities)
25,000
Variable costs
(per test):
Labor for
oversight and feedback
145
Outsourced
test analysis
15
Materials used
in testing
6
Production
overhead
11
Selling and
administration (e.g., scheduling and billing)
20
Number of
tests per month
2,000
tests
Required:...
The following data apply to the provision of psychological testing services: Sales price per unit...
The following data apply to the provision of psychological
testing services:
Sales price per unit (1 unit = 1 test plus feedback to
client)$300
Fixed costs (per month):
Selling and administration 20,000
Production overhead (e.g., rent of testing facilities)
17,500
Variable costs (per test):
Labor for oversight and feedback 165
Outsourced test analysis 17
Materials used in testing 7
Production overhead 12
Selling and administration (e.g., scheduling and billing) 14
Number of tests per month 2,000tests
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?
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Variable expenses per unit
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